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Content Tagged with cbs + Web
Why Buying CNet Makes Sense for CBS
What’s that saying? One man’s meat is another man’s poison? JANA Partners didn’t think highly of CNet’s scattershot approach to diversifying into non-tech segments (amongst many other issues). CBS, on the other hand, found the very same TV.com, Chowhound, GameSpot, UrbanBaby, MP3.com and other properties valuable enough to pony up $1.8 billion, a 45 percent premium to CNet’s closing price yesterday. That works out to about $11.50 a share. As you might remember, JANA Partners had acquired enough shares to launch a campaign to replace the management and the board. Now it might finally get its wish.
Nevertheless, no one saw this coming; Yahoo was thought to be a likely buyer. But we should have. Why? One man: Quincy Smith, CBS Interactive’s president. He used to be the banker who was quite intimate with CNet when he worked at Allen & Co., the New York boutique investment house. He understood their business, strategy and of course, their problems. He said as much today: “[I]t’s going to be great to work with Neil and his team, many of whom I have known for many years.”
What I think CBS needs to do is come to San Francisco with an industrial-sized equivalent of a corporate vacuum cleaner. First, it need to cut the sales and marketing head count by almost 15 percent. Second, it needs to cozy up to Google, Yahoo or Microsoft and get them to commit to an advertising deal. (The New York Times has one such deal with Yahoo, for instance.) And most importantly, it needs to clean up the site and make it SEO-friendly. I know Smith knows how to do this. And this might mean kicking out some of the people with which he has worked very closely.
This deal could go wrong quite quickly, due to the bureaucratic nature of the San Francisco shop. But still, I like the big, bold bet. Hell, with $405 million in sales and $176 million in profits, CNet seems a whole heck of a lot cheaper than Last.fm, which cost CBS $280 million. CBS’s current line-up of properties includes CBSSports.com, CBSCollegeSports.com, last.fm, Wallstrip and MobLogic, along with several other news-related properties.
Taken at face value, it might seem like a crazy deal, but in fact it’s a calculated, smart and well thought-out move.
Why this deal makes sense:
* CBS is buying media page views, not social networking page views, which are to tough to monetize, as indicated by recent research reports.
* CBS gets not just a footprint in technology — a growing mainstream opportunity — it also gets non-tech sites that can get some great push from CBS’s non-Internet properties.
* CBS is making a strong effort to give a proper facelift to all its operations and it needs a dot-com property with sizable traffic.
* Quincy Smith is a big believer in communities on the web, and one thing that CNet has not been able to do is build big communities, even despite sizable audiences. I expect this is going to be one of the top priorities for the newly combined company.
* CNet is easily fixable and had a great brand.
* Most importantly, this puts CBS ahead of NBC, ABC and others that have what I think are bumbling Internet/web strategies mired in legacy self-interests of individuals.
What its long-term implications are:
A combined CBS-CNet is basically going to push other networks and old media into action. Don’t be surprised if it sparks an irrational frenzy of buyouts. From Digg to Sugar Publishing, anything media could be in play soon enough.
Update: NewTeeVee’s take: CNET Won’t Be Net Media Kick in the Pants for CBS.
Why Did CBS Buy DotSpotter?
In these irrational times, let me attempt to offer a rational explanation for why CBS bought DotSpotter. Unlike Matthew Ingram, I have actually heard of DotSpotter, and wrote about them a while ago, so I know a couple of things about this company. First, they have an awesome team of developers, the kind CBS (CBS) badly needs. Second, if Last.fm was CBS’ Radio 2.0, then DotSpotter is their Water Cooler 2.0.
OK, as I said, this is just an attempt to explain why they bought this little-known company. My sources say the price is not, I repeat, not $10 million, but much lower. Of course, CBS doesn’t wanna talk about it!
Google: How High Can It Go?
Google (GOOG) crossed the $600-a-share threshold today, giving it a market capitalization of around $188.1 billion. The big questions is, how high can it go? $750, $1,000 or (shudder) $2,000 a share?
Here is what $188 billion buys you:
3,133 Gulfstream G550 jets a $60 million a pop. Basically one for anyone with the title “manager” who works for Google.
A whole lotta media companies: the New York Times Co. (NYT) ($2.86 billion), Reuters (RTRSY) ($16.5 billion), CBS (CBS) ($23 billion), Viacom (VIA) ($28 billion), News Corp. (NWS.A), ($71.5 billion) and Yahoo (YHOO) ($35 billion) — with money left over for buying Facebook at Zuckbuck-prices.
940K Virgin Galactic tickets.
Round-trip tickets to Mars for Larry and Sergey,
inflation adjusted, of course.The country of Ireland ($190 billion), to be renamed (B)Goog-org. Larry & Sergey can be the royal leprechauns.
CBS Acquires WallStrip for $5 million
Jossip is reporting that corporate focused video blog WallStrip has been acquired by CBS News for $5 million. The report states that an announcement is expected early this week and involves WallStrip host Lindsay Campbell being the next Amanda Congdon for CBS, fronting online shows.
I spoke to some one close to the deal who confirmed Jossip’s story. The deal is said to be focused on signing Lindsay Campbell. CBS was keen to have Campbell on board and a cast iron contract meant that acquiring WallStrip was the only way they could get to her.
WallStrip as a video blog/ show has previously met with mixed revues. The dry topics and patchy scripting being pulled off only by the shining talent of Campbell. As a deal it has a sense of “What The?” about it. My source says the company has zero revenue. Campbell has talent but if this was the driving reason behind the buy, they’d better hope she can tap dance as well.
Crunch Network: CrunchGear drool over the sexiest new gadgets and hardware.
Now a Rolling Stone Social Network
New York-based media giants are suddenly getting jiggy with the new new Media. CBS announced its mega-digital media strategy, which means Quincy Smith, the CBS Interactive head-honcho is finally putting a PowerPoint presentation he showed me last year to good use. You all know about the NewNoNameCo, and Viacom’s latest efforts.
Final proof that what started out as a little wave on the West Coast has hit the eastern media establishment: Rolling Stone magazine, once a favorite and must read for all music and pop-culture nuts is going to establish a social network. (If this means their uglier than pooch’s-rear-end site is going to get a facelift, I am all for it.)
Blanchard plans to launch a separate site that will be a social network for music fans, complete with profiles and the ability to have a say in their “Best of” lists. Blanchard called it the “American Idol version of lists.” Let’s hope Sanjaya doesn’t make it on any of those.
Err … have they checked out MOG lately? Rolling Stone clearly has its work cut out: the college crowd doesn’t care much for the brand, though formerly cool but rapidly aging hipsters still read the magazine, in a blatant attempt to capture their lost youth. (Okay, I am just speaking for myself.)
The challenges faced by Rolling Stone in the post-MySpace era are pointed out by NYU student journalist Andrea Feczko in this post.
Although college students are RS’s “target audience,” I’m under the impression that people 30 and above are the ones who actually read the mag. Did any of us really watch the MTV-RS reality show? No. Oh, and to clear the record, as a student journalist, I am NOT drunk writing this post.
Such sassiness… Andrea is going to be a great blogger.